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Monte dei Paschi Holders OK Capital Raising

Banca Monte dei Paschi di Siena SpA's shareholders Saturday authorized the bank to carry out a €3 billion capital increase only after May 12 next year,

By

Giovanni Legorano

Updated Dec. 29, 2013 12:36 p.m. ET

MILAN—Banca Monte dei Paschi di Siena SpA's shareholders Saturday authorized the bank to carry out a €3 billion ($4.1 billion) capital increase, but only after mid May, creating uncertainty about a share sale that the bank needs to avoid nationalization.

In the past weeks, the bank's management argued strongly that it needed to complete the cash call in January, asking shareholders for authorization to launch the transaction in the first quarter of next year. But the Monte dei Paschi foundation, the lender's largest...